The Energy Is in the Nuclear Talk

PARIS, Feb 13 2013 (IPS) - Nuclear energy and defence deals will be high on the agenda when French President François Hollande makes a state visit to India this week, but few analysts expect any solid contracts to result from the two-day trip Thursday and Friday.

“Because the nuclear industry is so much about show, and because so many countries want to be part of the nuclear club, there is a lot of talk and gentleman’s agreements saying they will cooperate and they will work together. But you don’t see too many contracts being signed,” says Sophia Majnoni, nuclear issues spokesperson for Greenpeace France.

Amid state banquets and corporate wining and dining, French officials are hoping to conclude negotiations on the sale of two reactors for India’s controversial Jaitapur Nuclear Power Project, which would be the largest nuclear power generating station in the world if realised.

Some sources close to French nuclear engineering company Areva indicated at last month’s World Future Energy Summit in Abu Dhabi that talks were indeed moving ahead; but several non-governmental organisations and industry insiders have said that this is wishful thinking on the part of the nuclear sector here.

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“Every time a French president goes to India, they’re always close to a deal to sell some power plants. It’s been a running joke for some time now,” said Joël Vormus, energy and environment project manager for the Comité de Liaison Energies Renouvelables (CLER), a non-governmental network of more than 200 professionals in the renewable energy sector in France.

“Each time we hear it, we more or less don’t believe it. Even the technology that we’re selling to Finland is way behind schedule,” he told IPS, referring to a European Pressurised Reactor (EPR) being built by French concerns on Olkiluoto Island, Western Finland, that has been beset by delays and cost hikes.

Anti-nuclear activists say that it is paradoxical that Holland’s administration is supporting the sale of nuclear technology abroad even as he has proposed reducing the amount of electricity generated from nuclear power in France to 50 percent from the current 75 percent by 2030.

It all comes down to economic issues, says Greenpeace’s Majnoni. “It’s very clear to us that because Hollande wants to reduce the share of nuclear in the French electricity mix, he has to sell nuclear (technology) abroad to be able to save jobs here and to have something to give to the nuclear industry in exchange,” she told IPS.

“It’s very tactical, and Germany and Japan have done it before,” she added. “They had the same strategy of exporting nuclear because their internal market was no longer there. All the countries that are phasing out nuclear for whatever reason – whether political or because of accidents – have to develop their export industry to balance their political decision.”

According to Greenpeace, the Fukushima nuclear disaster in Japan in 2011 changed the playing field because India, for instance, adopted a “progressive liability regime” to make nuclear suppliers liable in the event of an accident. “This is not acceptable for France,” Majnoni said.

But whether the technology comes from France or elsewhere, India has made it clear that nuclear power is an essential part of its energy mix. On a visit to Paris shortly after the Fukushima catastrophe, Dr. Srikumar Banerjee, a nuclear scientist who was then chairman of India’s Atomic Energy Commission, told IPS that the country was “reassessing safety” but that India has had a “good record” for more than 35 years.

“Our energy demands are very large, with growth of more than 10 percent a year, and these demands need to be met,” he said.

Another possible brake on concluding negotiations, however, could be the financial aspect, analysts told IPS. When Areva and the state-owned Nuclear Power Corporation of India Limited (NPCIL) began negotiations three years ago, the cost of the two European Pressurised Reactors for Jaitapur was put at 5.4 billion euros. But insiders say Areva now wants to renegotiate the price, which India is not happy about.

Speaking on condition of anonymity, an Indian analyst told IPS that it would be surprising if French officials came away with any agreement at the end of this week, despite the high-level delegation that will be accompanying Hollande.

The visiting group comprises key government officials such as ecology and energy minister Delphine Batho, and leading corporate executives such as Eric Trappier, the chief executive of French aircraft maker Dassault Aviation. The President’s partner Valerie Trierweiller will also be at his side.

Hollande will meet with Prime Minister Dr. Manmohan Singh as well as with the chairperson of the ruling United Progressive Alliance, Sonia Gandhi. He will see the leader of the opposition Sushma Swaraj and also meet with key business leaders in Mumbai, officials in France told IPS.

After numerous delays, India is still scheduled to purchase 126 French-built Rafale fighter jets from Dassault, in a deal reportedly worth more than 10 billion euros. During the huge five-day Aero India biennial air show that ended in Bangalore on Feb. 10, Trappier told French media that the company hoped to finalise the Rafale deal in 2013. This would be the first foreign sale of the fighter plane, which has seen few international buyers lining up despite multi-billion euro investments in its production.

An industry expert, who asked not to be named, told IPS this week that Indian officials have said that there’s still a “lot of work to be done” on negotiations, and that the time span to accomplish this would probably last until the end of this year. He predicted that an agreement would come before the next Indian general elections, scheduled for 2014.

For its part, New Delhi has stuck to diplomatic language with a statement that “relations between India and France have been laid on strong historical foundations and shared values.” With the upgrade of links to strategic partnership in 1998, the “relationship has become multifaceted and symbiotic in areas such as defence, civil nuclear energy, space and counter-terrorism,” it added. (END)